Revenue Commissioners to appear before PAC

AGENDA: (a) 9 a. m. Business of the Committee;
(b) C&AG Report 2015:
(i) Chapter 13: Revenue’s Review of Medical Consultants’ Tax Affairs
(ii) Chapter 14: Research and Development Tax Credit
(iii) Chapter 16: Deferral of Tobacco Stamp Liability
[Officials from the Revenue Commissioners]

Committee Chairman Seán Fleming said: “In 2010, Revenue became aware of a tax planning strategy that was being aimed at medical consultants. Following an initial review of a number of cases in order to ascertain the issues and the risks involved, Revenue decided to expand its review of the tax affairs of medical consultants nationally. The Committee will be interested to find out how Revenue became aware of the existence of this tax planning strategy, who devised the strategy and aimed it specifically at medical consultants and In general terms how Revenue gathers intelligence on the existence of tax strategies for different sectors and if there is a possibility that other professionals/consultants utilises similar strategies. Revenue established an internal working group to look at the tax issues arising from incorporation of professional practices with a view to publishing guidance. We will keen to find out if the group has completed its work, what were its findings and if the intended guidance has been issued.

“Chapter 14 on the Research and Development Tax Credit reviews the operation of the research and development tax credit, the cost of which has risen substantially since its inception in 2004.  It looks at the scale of non-compliance with scheme conditions and how Revenue systems and procedures can be improved in order to detect and deter non-compliance in this area. The Committee will want to ascertain why the required details of R&D compliance interventions have not historically been maintained and if Revenue has concluded its consideration of how information on R&D compliance work can be collated. We will also want to know what specific measures Revenue has taken to strengthen its engagement processes for experts and ensure that relevant tax clearance procedures are followed

The chapter in relation to the deferral of tobacco stamp liability reviews the exceptional circumstances that gave rise to the decision by Revenue to allow a company to defer part of a payment of tobacco stamp liability from December 2015 to January 2016. Shortcomings were noted in 2015 deferral case process - Revenue had not defined what constitutes exceptional circumstances under the relevant legislation; had not developed a written procedure for granting such deferrals; and there was no record of a business case having been made to support the deferral decision. We will want to know if there is a formal process now in place to ensure such decisions are documented and supported by an appropriate business case.”

This meeting will start in Committee room 3 at 9am on Wednesday, 1 June 2017.

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